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December 4, 2014

Rohit Chopra and CFPB Piss Off Private Student Lenders

Ombudsman Rohit Chopra of the Consumer Financial Protection Bureau (CFPB) can sleep soundly at night knowing he is doing something right.  The Wall Street Journal quotes Richard Hunt, president of the Consumer Bankers Association, as stating “There’s more tension between banks and those in the CFPB’s student-lending division than in all other areas of the CFPB combined.” Why is the private student loan industry so pissed off?  The CFPB and Mr. Chopra have persistently pushed private lenders to modify or refinance…

September 22, 2014

Expanding Pay As You Earn by Negotiated Rulemaking

The Department of Education has announced its intention to convene a negotiated rulemaking committee to develop regulations that expand the President's Pay as You Earn repayment plan by allowing more borrowers to cap their federal student loan payments at 10 percent of their income with the goal of making the expanded PAYE repayment option available to borrowers by December 31, 2015. Negotiated rulemaking is required by law for programs authorized under Title IV of the Higher Education Act of 1965 (unless the Secretary of the Department of Education…

September 19, 2014

How Income is Established for Calculating Student Loan Payments

Submit the Income-Driven Repayment Plan Request online at studentloans.gov.  If you have filed a federal income tax return in the past two years and the income on your most recent federal income tax return is not “significantly different” from your current income, you may use the IRS Data Retrieval Tool in the application to import the most recent year’s Adjusted Gross Income (AGI) into your application.  Your monthly payments will be calculated based on that AGI. Married student loan borrowers can choose to either: file…

By Heather  |  Category:  Pay As You Earn, IBR, Student Loan Repayment  

August 10, 2014

Only Direct Loans Are Eligible for Public Service Loan Forgiveness

Public Service Loan Forgiveness (PSLF) is available for Direct Loans ONLY.  If you have older federal loans from the FFEL Program, Perkins loans, or Health Professions Student Loans, you may consolidate those into a Direct Consolidation Loan (which is eligible for PSLF) and then start making payments towards forgiveness.  Any payments you may have made on the ineligible loans before they were consolidated into Direct do not, cannot and will never count toward the required 120 qualifying payments. Sorry.  I don’t make the rules,…

By Heather  |  Category:  Public Service Loan Forgiveness  

July 2, 2014

Higher Student Loan Interest Rates are Here for New Borrowers

​New federal student loan interest rates are established each summer for the loans that will be borrowed during the following school year.  The interest rates are based on the 10-year Treasury rate (a benchmark figure representing investor confidence).  Once you borrow, your interest rate is fixed for the life of the loan.     Here are the interest rates for loans disbursed on or after July 1, 2014, and before June 30, 2015: For Direct Subsidized and Direct Unsubsidized Stafford Loans for undergraduates, the interest rate…

By Heather  |  Category:  Student Loan Policy  
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